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Good article here by IG's Joshua Mahony on indices and strategies from last week if you missed it.

Compares indices to other markets and points out that indices are a good market to choose for those looking to buy and hold. In addition to the reasons he gives another is that indices themselves do not buy and hold, they discard the weak and adopt the strong.

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Dow continued upward yesterday with Dax following after a shaky start, both now slowing as they close in on the resistance level taken from the daily chart (orange). Will be interesting to see if Dow attempts this hurdle, the others will be watching closely.

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Caseynotes. I just came across this Forum and looked at your resistance posts earlier. I was pretty long The Dow and SPX and read your potential resistance at 25510. Just to say thanks for the work as i dumped the position this evening as we spiked on that test. It looks like you called that very well.

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Thank you @Stewart, am pleased my posts have been of some assistance. The key as a retail trader is to join the ride between levels but to avoid the battle at levels, so identifying those potential battle zones is of paramount importance.

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Worth keeping in mind the G20 meeting starting today and continuing over the weekend. Xi and Trump will be talking and twitter is wondering about the possibilities of an announcement on trade before markets re-open. Something to consider for any positions held over the weekend.

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When traders walk in this morning they can see a truce on the Trade issue and oil spiking higher, yet Indices have only moved 2%. Cash balances are high so this looks likely to test previous highs into year end now IMO. It doesn't have to go up in a straight line but valuations are not stretched and the year end affect is bolstered by this double news.

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Guest LiamS

Guest LiamS

Firstly thank you to all you regular contributors, as someone relatively new to trading, its great to see some experienced points of view and the logic behind it.

Do you think we will a close of the various gaps before we see the much fabled santa rally possibly driving things higher? and could this rally lead to new all time highs do you think?

My thoughts are if this DJI rally stays below the 76.4% at 26,284 (high 26,951 3-10-18, low 24,120 29-10-2018) (sorry I am not sure how to add charts to a post yet), then the down trend is in play still, however if this level is broken then a new all time high could be fair game.

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Guest Mercury

Guest Mercury

Mercury . There's no doubt at some stage over the next 18-24 months there will be a big bear correction to core stock markets but I really doubt it happens in the run up to January. Global trade news is on hold so we are back to positioning (too much cash around) and seasonals which should lead to a good run up from these levels . Asset Managers are showing next to nil returns for their performance YTD so they all have an incentive to drive markets higher so they look better. Hedge Funds will jump on that also.

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Market crashes, or correction, are never called by the wider market. All the interested parties mentioned in the above post are indeed wedded to the Bull. Hedge Funds aren't really proper hedge funds anymore, a better name for them would be trend following funds. They follow the trends way past the turns and get hammered. Contrarian traders seek exactly the set up outlined and when the technical analysis indicators are all good and the fundamentals are aligned they trade the turn. That's what I did on 8 Nov, then swung that trade because I felt we would get a strong counter rally from the "buy-the-dips" boys, a last gasp of the Bull. That's what I did yesterday, now stop protected with minimal exposure. Might be wrong but that's trading...

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PS: I forgot to mention, the scenario painted by Guest Mercury is exactly the same condition as in 2007, the Market Top then was already in (October...!) and Santa decided to stay by the fire in the North Pole that year...

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Worth a recheck of the weekly charts to put yesterday's drop into perspective.

Dax continues to struggle, on top of the smoldering Italian banks story comes the ongoing 'too big to fail' Deutsche Bank drama with several raids on their head office over the last few days over corruption scandals too numerous to mention.

On the Dax chart looking for a break above 11207 or a retest of 11137.

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Ya didn't see that one coming did ya. Canada Has Arrested Huawei’s Global Chief Financial Officer In Vancouver. China embassy in Canada demands immediate release of Huawei CFO. Canada has arrested the chief financial officer of China’s Huawei Technologies, who now faces extradition to the United States on suspicion she violated U.S. trade sanctions against Iran.

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The EU has indicated that Theresa May needs to get backing from parliament on her Brexit deal before they agree to delay the UK's withdrawal from the EU. The Prime Minister is heading to Brussels today for the European Council meeting to try to force an extension in order to avoid a no-deal scenario.

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